2 buy-rated ASX dividend shares for income investors to snap up

Telstra Corporation Ltd (ASX:TLS) and this ASX dividend share come highly rated. Here's what you need to know…

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Thankfully in this ultra-low interest rate environment, the Australian share market is home to a large number of dividend shares for investors to choose from.

Two ASX dividend shares that could be great options for income investors are listed below. Here's why they come highly rated:

Fortescue Metals Group Limited (ASX: FMG)

Fortescue is one of the world's leading iron ore producers and appears well-placed to deliver another robust result in FY 2021. This is thanks to its record shipments, ultra-low C1 production costs of US$12.74 per wet metric tonne, and the sky high iron ore price.

In respect to the latter, the iron ore price has been tipped to climb beyond US$180 a tonne next month. This is being driven by strong demand in China and production disruption in Brazil.

Analysts at Macquarie are expecting this to lead to Fortescue paying a very generous dividend in FY 2021. The broker has pencilled in a dividend of approximately $2.61 per share fully franked. Based on the current Fortescue share price, this equates to a massive 11% dividend yield.

Telstra Corporation Ltd (ASX: TLS)

Another dividend share to look at is Telstra. With the end of the NBN rollout is sight, the arrival of 5G internet, cost cutting, and its T22 strategy, Telstra's outlook is arguably the most positive it has been in a decade.

In addition to this, the company is aiming to unlock value for shareholders by splitting its business into three separate entities. Management believes the restructure would enable the company to take advantage of potential monetisation opportunities.

Goldman Sachs thinks Telstra would be a good option for income investors. It recently reiterated its buy rating and $3.60 price target on its shares. It has also reaffirmed its forecast for a 16 cents per share fully franked dividend in FY 2021 and beyond. Based on the current Telstra share price, this would provide investors with a 5.3% dividend yield.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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